A 4-Year Bond with a Price of 100

question 22

Multiple Choice

A 4-year bond with a price of 100.696 exists.The duration on the bond is 3.674.If the yield rises from 5.8% to 6.2%,what is the new bond price as estimated by the duration?

• A) $98.40
• B) $99.30
• C) $100.60
• D) $101.40

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Definitions:

Physiological Needs

The basic physical requirements for human survival, such as air, water, food, shelter, and sleep, which must be met to achieve a basic level of health.

Cognitive Appraisal Theory

A model of emotion stating that a person's cognitive response to a situation determines their emotional experience.

Cognitive Dissonance Theory

A theory proposing that people experience discomfort (dissonance) when their beliefs or behaviors are inconsistent, often leading to a change in one to reduce the dissonance.

Cannon-Bard Theory

A theory of emotion that argues emotions and physiological responses occur simultaneously and independently, rather than one causing the other.